Customer-service outsourcing — coming to an airport near you

Mention outsourcing and most Americans who travel frequently will roll their eyes and think of reservations offices in India.

But, in reality, outsourcing happens right here in the United States and it affects travelers more than many think. For example, hotels may outsource maid service to a contract firm that can offer lower wages and fewer benefits than the hotels themselves.

As I heard from a lifeguard at the Westin Maui last year, hotels can also do the same thing with their recreation staff, firing the employees and working with companies that provide contract staff; again, with lower wages and benefits.

Airlines are not exempt. Recently, United announced plans to turn customer positions at 12 U.S. airports into contract jobs — more than 600 positions that include ticket and gate agents and baggage handlers. United says they are mostly airports served by United Express flights, although the list includes some big cities: Detroit, Albuquerque, Buffalo, Charleston, Charlotte, Columbus, Des Moines, El Paso, Sioux Falls, Wichita, Pensacola and Salt Lake City.

(To be fair, United does say at the same time they are converting 400 contract workers to employees at hub airports such as Denver, Honolulu and Dulles. Where the airline has a large presence, and a desire to fight off competition.)

For travelers, the difference between a contract worker and a United employee may not even be noticeable. The job descriptions are the same. But United workers get union wages and airline benefits, including travel benefits. So, their motivation might be a bit different than that of a contract worker not making much more than minimum wage and with zero benefits.

Presumably, these contract companies have some incentive clauses for their workers. But when it’s one of those really awful travel days with maintenance and/or weather delays, or simply bad holiday traffic, it’s hard for me to believe the contract workers will have the same motivation as an airline employee.

Plus, a contract worker won’t have the same sort of long-time system knowledge that most frequent fliers have benefited from at times when there’s a problem. More than once, even as a travel agent who can solve a lot of my own problems, I’ve still needed a good gate agent to help. Whether it’s rebooking a flight or helping with a connection or luggage issue, having a crafty veteran on our side is the key to good service.

These new contract jobs also don’t seem likely to even have the chance of becoming permanent airline jobs again, as the affected airports are ones where United is downsizing its presence. Worse, with smaller planes and less service, the airline will lose still more market share.

Now, on the other side, airlines exist to make a profit, as do hotels and other travel companies that are moving to contract labor in many cases. From a strict bottom line perspective, sure, outsourcing seems to be considerably cheaper with a contractor from a benefits perspective alone, not to mention lower wages even with the contractors’ fees.

For that matter, contract workers at the airport or at a hotel presumably have to do reasonably competent jobs to stay employed.

We’ve all had frustrating travel days when we think, “Don’t these people even care about their company’s survival?” Increasingly, the response has to be “It’s not MY company.”

At my local airport, most of the “smaller” carriers have moved to a single onsite contractor to provide CI and GAs. I love it. When the stuff hits the fan with weather delays, all of the terminals and most of the Check in agents can “flex” to help the airline in trouble. I’ve watched an agent reroute someone from UA to AA and then walked them down to AA to check them in. I’ve seen 5 or 6 agents working behind one airline’s desk when cancellations occur. Much better than when UA/AA staffed their desks with one person and a flight delay meant one person trying to reroute 50 people.

As far as the lifeguard angle, I know some local hotels that have gone that route. Talking with the lifeguards, their pay scale didn’t change but the new company brought in training programs etc that resulted in lower costs for the hotel and better trained lifeguards…. sounds like the perfect “win-win” to me.

AirlineEmployee

“(To be fair, United does say they are hiring 400 contract workers at hub airports such as Denver, Honolulu and Dulles.)”.

Your wording is confusing here. United is not (new) “hiring” 400 “contract” workers at DEN, HNL, and IAD. They are keeping/ insourcing (or again using) their own employees to fill positions they did outsource to a vendor for a while. In other words they are restoring jobs to United employees who had them in the first place. Still doesn’t make up for the already hundreds of jobs lost by United employees. CO dba UA would prefer to outsource to the lowest bidder rather than keep people with years of experience and incentive (wages, job security and fair work rules). More to come as they increase their already 67% United Express service (domestic). All their doing is making people hate United even more than they possibly could and just migrate to AA, WN and DL. Ridiculous.

janice

Hi John, appreciate your point on your airport, but at the Westin hotel where I heard of this the lifeguard told me they were being let go, in favor of contract people paid half the amount and they wouldn’t have starwood benefits.

janice

will see if i can adjust the wording, I meant what you said. sorry.

Graham Harrison

There is nothing new in the world. I used to go to San Francisco on BA to see family in the 90s and on the flight back to London their check in staff were America West staff. There were maybe 2 actual BA staff working there. I seem to remember Denver (where I went on business) had a similar arrangement but I can’t remember who with.

AirlineEmployee

All well and good that you love it and it works for you. Me, I have a problem with it.

CEO’s and their top kingpins make all the money. They have no concern for the average middle-class “nobody” who just wants to work, earn a livable wage, maybe have a few extra bucks to have a better lifestyle and quite possibly hang onto the only job that has a little value, benefits and travel perks.

I’ll take off my politically correct straight jacket and declare that these jobs are going to foreigners who have probably set foot in this country only a short while ago and think that making $10.00/hour with no benefits is the best thing since sliced bread. As well, they can barely speak understandable or grammatically correct English…..and you really think they are going to be “handling”, “fixing”, “understanding”, and “caring” about YOU ? I’m sick of every corporation in American dumbing us down to a third world mentality and we’re supposed to swallow it in the name of diversity, tolerance, freedom and the “American Dream” – watered down to nothing,

AirlineEmployee

Thanks Janice.

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